An agreement has been signed between Europe and the South American MERCOSUR countries that will expand trade relations after many years of discussion.
The document was signed by European Union leaders and high-level representatives of the South American trading bloc at a ceremony in Paraguay.
The new agreement will create a large free trade area covering 700 million people, linking Europe and South American countries. Although Bolivia is a member of the group, it will not participate in the agreement in the initial phase.
It should be noted that the document was approved with the support of 21 of the 27 countries in the EU. The new trade zone is also seen as a counterweight to US customs policy. The agreement will eliminate customs duties on the vast majority of goods, which will increase exports from Europe to South America by about 40 percent.
Experts note that this agreement will create new opportunities for the European automotive, mechanical engineering and pharmaceutical sectors. In return, Europe will mainly buy agricultural products and raw materials.
The German broadcaster, Deutsche Welle wrote,
As the EU's share of the global market slips, the Mercosur deal could unlock access to critical raw materials. It's also indicative of a wider EU economic pivot.
source: commonspace.eu with agencies
photo: The signing of a new agreement between the EU and MERCOSUR in Paraguay on 17 January 2026.
